Blog:Brand China taking a hammering

Reports this week that nearly half of the water coolers across Beijing have allegedly been filled with bogus water will surprise no-one in the drinks industry who has been battling with fraudsters and counterfeiters in this most difficult of markets for years.

I remember a few years ago talking to one brand manager in the industry who believed that the vast majority of bottled spirits being sold across bars in the country were filled with fake liquid. Although things are said to be better now, I suspect progress in trademark protection has, in truth, been painfully slow.

Now China’s reputation for fake goods is starting to grab international headlines outside of the trade press as the country’s reputation as a powerful exporter takes a hammering from a number of product safety scandals that have been exposed – particularly in the US.

Toxic toothpaste, poisonous pet food and tyres that explode whilst on the road – these are just some of the products produced by Chinese companies that have grabbed the attention in the last few months.

And the consequences for this rapidly expanding economy are potentially highly damaging.

“Now the true picture is emerging, and it isn’t pretty,” wrote the influential publication Newsweek on 16 July. “Far from the disciplined and tightly controlled economy China was thought to have, the ongoing scandals have revealed an often chaotic system with lax standards.”

As the article goes on to explain: “Unless Beijing can improve its image fast and turn “Made in China” into a prestigious – or at least reliable – brand, consumers will remain at risk and the country’s export-driven economic miracle could face serious trouble.”